Daniel A. Weiss, Attorney at Law

SUBSEQUENT OWNER RESPONSIBLE FOR TANGIBLE PERSONAL PROPERTY TAXES?

By admin • August 17, 2006 • Filed in: Uncategorized

One of the readers of our blog recently posed an interesting question. He wanted to know whether a subsequent owner is responsible for a prior owner’s delinquent taxes on tangible personal property.

The question was posed as follows.

A local laundry owner is given notice to pay tangible taxes from the year 2000. Is it fair the owner has to pay these taxes, plus interest, to the county tax collector if he has owned the laundromat only a year, i.e., since 2005? There have been at least 3 or 4 different owners since 2000.

Should the county not go after the owner as of January 1, 2000, and make him solely responsible for paying these tangible personal property taxes?

I wrote back to the inquiring blogger as follows.

Dear Taxpayer,

It may not be fair, but it does appear to be the law. The subsequent owner is responsible for paying the taxes, or for allowing the tax collector to seize the property, based on the following briefly-stated analysis.

Initially, a tangible personal property tax is “in rem”, i.e., against “the thing”, or taxed tangible personalty, itself.

By statute, the tax collector first goes to the property itself, in whomsoever’s hands it may be found. This approach to collection of delinquent property taxes appears to be authorized by law.

Section 197.413, Florida Statutes, provides the procedure to be followed by the county tax collector in collecting delinquent tangible personal property taxes.

In pertinent part, that statute provides that after filing suit and obtaining from the court issuance of a court order for levy and seizure of personal property, and warrants to be served on individual taxpayers, the tax collector may seize property on which taxes are due, even when such “goods” or “chattels” are in the hands of another person. “Goods and chattels” is a phrase which generally denominates personal property, as distinguished from real property.
Subsection (8) of section 197.413 provides as follows:

8) A tax warrant issued by the tax collector for the collection of tangible personal property taxes shall, after the court has issued its order as set forth in subsection (6), have the same force as a writ of garnishment upon any person who has any goods, moneys, chattels, or effects of the delinquent taxpayer in his or her hands, possession, or control or who is indebted to such delinquent taxpayer.

The legislature in Florida, as elsewhere, generally provides a strong arsenal of weapons to favor the taxing authorities in the assessment and collection of taxes.

The best you can do is to go and reason with the tax collector, and show him that you were not the taxpayer at the time the taxes were levied and that you purchased the property in good faith with no actual notice of the delinquent taxes.

The response of the tax collector may well be that you should have inquired and made sure the taxes were paid at the time you purchased the equipment–just as you would have inquired concerning the tax status of any real property.

The only good news here–i.e., if the tax collector does not negotiate some settlement with you at your request–is that once you deliver the property of the delinquent taxpayer to the tax collector levying the warrant, the receipt of the tax collector shall be complete discharge of any obligation you have to the tax collector for those delinquent taxes on the seized property. See subsection (9) below.

The tax collector is authorized to pursue the former owners of the taxed property for the difference in unpaid delinquent taxes, penalties and interest.

The cited statute is provided below in its entirety.

We trust this answers your question in general terms. While the controlling statute has been amended slightly from time to time, there is not an abundance of case law on this point. The foregoing represents our understanding of applicable Florida law. It is not intended as a legal opinion. Feel free to retain counsel for the purpose of obtaining a formal written opinion as it relates to your specific factual situation.

Incidentally, seizure and sale of personal property is virtually a universal enforcement mechanism for the collection of unpaid and delinquent tangible personal property taxes. It is not unique to Florida.
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(1) Prior to May 1 of each year immediately following the year of assessment, the tax collector shall prepare a list of the unpaid personal property taxes containing the names and addresses of the taxpayers and the property subject to the tax as the same appear on the tax roll. Prior to April 30 of the next year, the tax collector shall prepare warrants against the delinquent taxpayers providing for the levy upon, and seizure of, tangible personal property. The cost of advertising delinquent tax shall be added to the delinquent taxes at the time of advertising. The tax collector is not required to issue warrants if delinquent taxes are less than $50. However, such taxes shall remain due and payable.
(2) Within 30 days after the date such warrants are prepared, the tax collector shall cause the filing of a petition in the circuit court for the county which the tax collector serves, which petition shall briefly describe the levies and nonpayment of taxes, the issuance of warrants, and proof of the publication of notice as provided for in s. 197.402 and shall list the names and addresses of the taxpayers who failed to pay taxes, as the same appear on the assessment roll. Such petition shall pray for an order ratifying and confirming the issuance of the warrants and directing the tax collector or his or her deputy to levy upon and seize the tangible personal property of each delinquent taxpayer to satisfy the unpaid taxes set forth in the petition. This proceeding is specifically provided to safeguard the constitutional rights of the taxpayers in relation to their tangible personal property and to allow the tax collector sufficient time to collect such delinquent personal property taxes before the filing of petitions in the circuit court and shall be conducted with these objectives in mind.
(3) The tax collector may employ counsel, and agree upon the counsel’s compensation, for conducting such suit or suits and may pay such compensation out of the general office expense fund and include such item in the budget.
(4) Immediately upon the filing of such petition, the tax collector shall request the earliest possible time for hearing before the circuit court on the petition, at which hearing the tax roll shall be presented and the tax collector or one of his or her deputies shall appear to testify under oath as to the nonpayment of the personal property taxes listed in the petition.
(5) Upon the filing of such petition, the clerk of the court shall notify each delinquent taxpayer listed in the petition that a petition has been filed and that upon ratification and confirmation of the petition the tax collector will be authorized to issue warrants and levy upon, seize, and sell so much of the personal property as to satisfy the delinquent taxes, plus costs, interest, attorney’s fees, and other charges. Such notice shall be given by certified mail, return receipt requested.
(6) If it appears to the circuit court that the taxes that appear on the tax roll are unpaid, the court shall issue its order directing the tax collector or his or her deputy to levy upon and seize so much of the tangible personal property of the taxpayers who are listed in the petition as is necessary to satisfy the unpaid taxes, costs, interest, attorney’s fees, and other charges.
(7) The court shall retain jurisdiction over the matters raised in the petition to hear such objections of taxpayers to the levy and seizure of their tangible personal property as may be warranted under the statutes and laws of the state.
(8) A tax warrant issued by the tax collector for the collection of tangible personal property taxes shall, after the court has issued its order as set forth in subsection (6), have the same force as a writ of garnishment upon any person who has any goods, moneys, chattels, or effects of the delinquent taxpayer in his or her hands, possession, or control or who is indebted to such delinquent taxpayer.
(9) When any tax warrant is levied upon any debtor or person holding property of the taxpayer, the debtor or person shall pay the debt or deliver the property of the delinquent taxpayer to the tax collector levying the warrant, and the receipt of the tax collector shall be complete discharge to that extent of the debtor or person holding the property. The tax collector shall make note of the levy upon the tax warrant.
(10) The tax collector is entitled to a fee of $2 from each delinquent taxpayer at the time delinquent taxes are collected. The tax collector is entitled to receive an additional $8 for each warrant issued.
History.–s. 170, ch. 85-342; s. 3, ch. 86-141; s. 38, ch. 87-224; s. 56, ch. 94-353; s. 1479, ch. 95-147; s. 9, ch. 98-139.
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Daniel A. Weiss is a former Attorney Special Master for the Miami-Dade County Value Adjustment Board. Mr. Weiss now represents commercial, institutional charitable, commercial, high-end residential, agricultural and municipal taxpayers at VAB proceedings throughout the State of Florida. Mr. Weiss handles both valuation and legal claims.

Mr. Weiss has over 25 years property tax experience. Mr. Weiss represented the Miami-Dade County taxing authorities in litigation and appeals between 1981 and 1995 as a Miami-Dade Assistant County Attorney and has since represented taxpayers in property tax matters.

Mr. Weiss appears as one of Florida’s Super Lawyers 2006 in the publication of the same name. He was named by his peers as one of the top 6 local government lawyers in South Florida.

In Florida Trend magazine™’s Legal Elite’s issue, July 2004, Mr. Weiss was selected by his peers as one of the top 30 government lawyers in the State of Florida.

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